Record equity transactions and indicate the effect on the balance sheet equation (LO10–2, 10–3, 10–4, 10–5)
Nautical has two classes of stock authorized: $10 par preferred, and $1 par value common. As of the beginning of 2018, 125 shares of
March 1 | Issue 3,000 additional shares of common stock for $10 per share. |
April 1 | Issue 175 additional shares of preferred stock for $40 per share. |
June 1 | Declare a cash dividend on both common and preferred stock of $0.25 per share to all stockholders of record on June 15. |
June 30 | Pay the cash dividends declared on June 1. |
August 1 | Purchase 175 shares of common |
October 1 | Reissue 125 shares of treasury stock purchased on August 1 for $9 per share. |
Nautical has the following beginning balances in its stockholders’ equity accounts on January 1, 2018: Preferred Stock, $1,250. Common Stock, $3,000, Additional Paid-in Capital, $19,500; and
Required:
1. Record each of these transactions.
2. Indicate whether each of these transactions would increase (+), decrease (–), or have no effect (NE) on total assets, total liabilities, and total stockholders’ equity by completing the following chart.
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